Experts upbeat on global economy as Asia seen driving growth There is reason for optimism about the global economy in 2014 despite some key challenges posed by the US monetary easing, relapse of the European sovereign crisis and a hard-landing by the Chinese economy, president of the Euro Group Jeroen Dijsselbloem said on the opening day of the Asian Financial Forum on Monday. Dijsselbloem, who is also the Netherlands' finance minister, said his upbeat forecast is based on the US economic recovery, Asia's reasonably good performance and signs of a pick-up in Europe with the new banking sector regulations and improvement in overall business climate. Warning against complacency, Dijsselbloem said he was optimistic that the EU would make a decision on the bloc's banking union. The European Central Bank is due to take over the supervision of the eurozone's systemically important banks and EU ministers have agreed on a Single Resolution Mechanism (SRM) for the bloc with the objective to strengthen the Economic and Monetary Union . SRM is set to centralise key competences and resources for managing the failure of any bank in the euro area and in other member states participating in the Banking Union . More than 2,300 business leaders and senior government officials from around the world are in Hong Kong for the seventh Asian Financial Forum (AFF), which continues through Tuesday at the Hong Kong Convention and Exhibition Centre . Delegations of senior executives from Australia , Canada , and the Chinese mainland, Germany , India , Indonesia , Japan , Korea , the Philippines , Russia , South Africa , Thailand , the United Kingdom and the United States are among those taking part in the forum. With the global economy continuing to shift to the East, prospects on the Chinese mainland and throughout the Asian region dominate the two-day forum. Hong Kong Trade Development Council Chairman Jack So underlined in his welcome remarks that Asia was vital for driving the global economic growth. "You're here because, undoubtedly, Asia has proven to be vital — to the global economy and world financial system, and to your business bottom line," said So. "Led by the Chinese mainland and, increasingly, Asean, this region has emerged, in recent years, as the world's economic and financial engine. Which is why ' Asia : Powering World Growth,' is the theme of our seventh forum." He also stressed the need to press ahead with structural reforms by European and Asian economies. The forum's opening session focused on Asia's growing role in the global economy. Apart from Dijsselbloem, speakers at the first session included Alexey Moiseev , deputy finance minister of Russia ; and Takehiko Nakao , president of the Asian Development Bank . All speakers at the opening session agreed that Asian economies would exert a strong impact on the global financial landscape by powering the economic growth but cautioned that there should be more structural reforms. Asia is also expected to play a key role in the export of sovereign and private wealth. Speakers were however divided on the view that Asian economies exemplify in financial and fiscal prudence. ADB chief Nakao said he was confident that emerging Asian economies would weather the impact of reduced US monetary stimulus and predicted growth of about six per cent in 2014. Nakao, a former Japanese vice-finance minister, said the market has already incorporated elements of the tapering-off Federal Reserve asset purchases. However, he cautioned that political stability should be a priority and it was important that policy makers in the region use the period of stability to address domestic policy needs. The ADB has raised its 2014 growth forecast for China to 7.5 per cent from 7.4 per cent while cutting its forecast for Southeast Asia to 5.2 per cent from 5.3 per cent. It maintained its forecasts for developing Asia to grow six per cent in 2013 and 6.2 per cent in 2014. The ADB chief, who took office in April 2013 , said economies in the region should continue their structural reforms and policy makers should be mindful that their policies should be very strong. Indonesia and India should take care of their fiscal deficits, and Indonesia must pursue needed structural reforms, especially liberalisation of the retail market and financial market. He said Asia's challenges were only partially addressed, while new challenges emerge. According to Nakao, growing inequalities in income and opportunities are emerging as a major development challenge. "These increasing inequalities have reduced the impact of economic growth on poverty reduction and can potentially impede the growth process itself. Asia's changing demographics — with both an aging population and a youth bulge — reveal deficits in social protection and job creation. The quest for growth is increasing the pressure on natural resources, while the growing exposure to disasters and threat of climate change could reverse hard-won development gains." More than 100 speakers are participating in this year's forum. Timothy Geithner , Secretary of the Treasury under US President Barack Obama from 2009 until January 2013 , will be the keynote speaker on Tuesday. Other prominent speakers include Saeb Eigner , chairman Dubai Financial Services Authority ; Paul M Achleitner, chairman of the Supervisory Board, Deutsche Bank AG ; Ding Xuedong, chairman and CEO, China Investment Corporation ; Do Hoang Anh Tuan, deputy minister, Ministry of Finance , Vietnam ; Fu Yuning , chairman, China Merchants Group ; Jih-Chu Lee , chairperson, Bank of Taiwan ; Robin Li , chairman, CEO and co-founder, Baidu Inc ; Carlo Mazzi , deputy chairman, Prada S.p.A ; Klaus Regling , managing director, European Stability Mechanism; Tu Guangshao, executive vice-mayor, Shanghai ; Fiona Woolf , lord mayor, City of London , and Levin Zhu , president and CEO, China International Capital Corporation . Second-day highlights include a series of thematic workshops. These will examine opportunities ranging from the liberalisation of the mainland's financial market to private wealth management, captive insurance, Islamic finance, Asean, free trade zones, Qianhai, opportunities in natural resources and energy, and Chinese outbound investment between investors and businesses looking for investment. They will include dedicated matching between Chinese corporate investors and international project owners looking for mainland capital. The AFF is the anchor event of International Financial Week and its 10 finance-related events. Highlights include the Asia Private Equity Forum opening on Wednesday. More than 3,000 people are expected to take part in the week-long activities. Launched in 2007, the AFF is Asia's premier annual financial and business event. The forum is organised by the Hong Kong SAR Government and the HKTDC.
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